As smog season begins and winter in most parts of the country is bitterly cold, China is wary of leaving lots of residents without heat.
As the national economic slowdown bites confronting a trade war with the US, top CCP leaders in Beijing have felt the freeze too in fear of more severe challenges ahead.
Chinese president Xi Jiping, last Thursday, shouldering the CCP’s mission of sending warmth to the less fortunate, convened an unprecedented symposium to hear the views of dozens of representatives from the private sector – including Robin Li of Baidu and Pony Ma of Tencent.
Trying to give private business a confidence boost, the president tells gathering of entrepreneurs that their businesses will be supported with ‘substantial’ tax cuts and bailout funds.
Xi’s economic policymakers, ministers and bankers as well as the vice-premiers, Han Zheng and Liu He, were also present with promises for equal treatment of private and public sectors.
Xi shook hands with the business delegates, saying, “I’m here today to boost your confidence,” according to state television CCTV.
During the meeting, President Xi outlines six measures to support private businesses, including:
The burden of taxes and fees on the companies should be eased; measures should be taken to address the difficulty and high cost of financing for private firms; the playing field should be leveled; policy implementation should be improved; a new type of cordial and clean relationship between government and business should be established; and entrepreneurs’ personal and property safety should be ensured.
The president says, “The private enterprises and private entrepreneurs belong to our own family.”
With this meeting, China is signaling that it is worried about its economy and there is a crisis of faith in the nation. The whole middle class has lost confidence after the government’s Ponzi schemes one after another.
“For China, signs of a further slide in growth and threats of expanded tariffs from the U.S. are an unfortunate combination,” noted Bloomberg chief economist Tom Orlik.
An unprecedented convergence of economic stresses this year is weighing on China’s once vibrant private sector, compelling some entrepreneurs to question the effectiveness – and true intent – of Beijing’s policies, as the New York Times commented recently.
It continues to say that “some of the millions of struggling private firms are worried Beijing is more focused on supporting giant state-owned enterprises (SOEs), even as China celebrates the 40th anniversary of landmark economic reforms that rekindled entrepreneurship in the communist country.”
“With economic growth slowing and Beijing cracking down on riskier forms of borrowing, China’s private sector is grappling with a financing crunch that has pushed some firms into distress.”
So far this year, at least 40 listed private firms have announced stake sales to state firms on the back of financial stresses worsened by the stock market rout, according to state media.
China’s middle class has rapidly expanded over recent decades amid an enormous economic boom which showered the country’s citizens with unprecedented wealth, says a CNN reports yesterday.
It tells, “Tongue-in-cheek reactions such as ‘the government is going to harvest the leeks again’ or “we’re being picked like leeks” are common among members of the middle class.”
The problem of economic distress among Chinese citizens is so common that there is a buzzword on China’s cybersphere for people like Mr. Wang — “jiucai” , leeks or meat on the chopping board. “I’m a typical leek that is picked in the stock market, rental market and as a consumer,” he said.
In September, the resignation of Alibaba chairman Jack Ma has made headlines across the globe.
“Jack Ma’s stepping down from Alibaba’s top job was apparently to avoid investigation by the US and European governments into his collaboration with the CCP government besides online sale of fake products,” says Chinese billionaire Miles Kwok.
Jack Ma is smart. Very clear about the government’s intention to socialize his business, surely other private companies as well, Jack “willingly” gives out the control key of his internet giant to evade more severe punishment. The families of former President Jiang Zemin and Premier Zhu Rongji whom he has collaborated must have warned him about the socialization of private businesses, according to Miles.
So apparently Jack Ma saves his own life by giving out his money, but with this resignation, he shoulders off his responsibilities for money laundering. To internationalize his foundation, he finds a way out for part of his “clean” earned cash, recruiting some of the world’s top financiers into his board of directors, Miles commented.
Chinese noted political commentator Cao Changqing said in September, “The resignation of Jack Ma is totally irrational. Aged 54, healthy without signs of disease, his company at the prime of development, very rich himself with his business valued at US$400 billion, his own share US$ 3.4 billion, Jack Ma is lying that he has planned this resignation for over ten years… the only reason is that he has been under severe pressure from the Chinese government. So he has to step down.”
“With shareholders including the grandson of former president Jiang, and sons of former premier Wen Jiabao and Politburo member Liu Yunshan, Jack Ma’s business should be fully secured and backed-up. The main reason is a fight for dominance between SOEs and private businesses in the country for over 40 years, although not excluding the fact of an internal fight within these key shareholders,” Mr. Cao is sure of his analysis.
He says private businesses have come under severe pressure with the communist system, and in the past ten years, many noted private entrepreneurs were either put in prison or murdered. This is a war without gun-fire exchanges, but it is cruel and fatal.
According to Mr. Cao, over 27 million private companies plus 67 million self-employed businesses make up 90% of all businesses in China, employ 90% of the work force, and are responsible for 90% of the taxes, and 65% of its GDP. They build the country but also are seen as a threat to the CCP regime whose officials have become afraid of losing control of the commerce, the finance, or even the whole economy with the development of private sectors.
That is why the fates of these billionaires Wang Jianlin, Xiao Jianhua, Wu Xiaohui, Xu Ming and Wang Jian are so deplorable. Only Miles Kwok is the lucky one to flee to the US and start his whistle blows, says Cao Changqing.
Wang Jianlin, the founder and chairman of Dalian Wanda group, one of the world’s biggest commercial real estate developers with more than 200 plazas in China, who once boasted about his sprawling global business empire, is now barred from leaving the country.
Xiao Jianhua disappeared at Four Seasons Hotel in Hong Kong in January, and no one has heard from him since then. It seems that he engaged in corrupt activities, but Chinese authorities never announced where he was being investigated on what charges.
Wu Xiaohui, the glamorous, high-profile financier behind the insurance giant Anbang, and known for his connections with Deng Xiaoping, was sentenced to 18 years in prison after being convicted of fund-raising fraud this may.
Former HNA chairman Wangjian was murdered in July, but reportedly by CCP controlled media that he died from fall of taking photos while visiting a French church.
Xu Ming was the founder of the conglomerate Dalian Shide Group, and China’s top football club in the 2000s. In 2005 Forbes ranked him the eighth-richest person in China. Xu had close relationships with several high-ranking government officials and their families, especially the former Politburo member Bo Xilai. After Bo was implicated in a political scandal in 2012, Xu was taken into custody and died in prison December 2015, less than a year before his scheduled release.
Wang Lijun served as vice-mayor and police chief of the megacity of Chongqing. In September 2012, Wang was convicted on charges of abuse of power, bribery, and defection, and sentenced to fifteen years in prison. During Bo Xilai’s campaign to crackdown private businesses in organized crimes, Wang Lijun dropped hundreds of entrepreneurs into jail while confiscating their wealth.
“This is just one tip of the iceberg,” says Mr. Cao, “Wang Lijun has confiscated at least 20 billion yuan after persecuting hundreds of private businesses. He has sent the loot to top CCP officials and their families. His mouth must be sealed up. We don’t know if he is still alive or not”.
In the past two decades, millions of middle-class businessmen and their families have migrated overseas, fleeing their once-loved motherland now hard to call home.
By Cao Changqing and Staff writer